Grok’s Federal Stall and SpaceX’s IPO Growth Story
May 21, 2026 – 10:28 am
Downloads for Grok, once reaching 20 million in January, have plummeted to 8.3 million in April, while paid conversions stand at a paltry 0.174%—a fraction of ChatGPT’s 6%. The GSA OneGov agreement, signed by Elon Musk’s xAI chatbot in September 2025, worth $0.42 per organization for 18 months, has stalled due to accuracy and bias concerns raised by Public Citizen and questions over classified-system access by the Department of Defense.
The rental of the Memphis Colossus 1 data center—Grok’s primary training environment with 220,000 Nvidia GPUs and 300 megawatts of capacity—to Anthropic for $1.25 billion per month through May 2029 highlights the discrepancy between xAI‘s excess compute power and insufficient consumer demand.
These factors cast doubt on Grok‘s ability to support SpaceX’s IPO growth story, especially given xAI’s losses of $6.4 billion from operations on $3.2 billion in revenue in 2025—a growth rate significantly lower than its competitors.
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